What Is Header Bidding & How Does It Work?

What is Header Bidding?

Header Bidding is a programmatic advertising technique that enables publishers to increase their ad revenue by running a digital auction before a publisher’s Ad Server loads. Because this auction happens in the header before normal ad serving begins, it is also referred to as Pre-Bidding and Advance Bidding.

In a Header Bidding auction, multiple ad networks and exchanges are invited to participate in a First-Price Auction and bid simultaneously for ad inventory. A Header Bidding auction is usually run by JavaScript loaded in the header, and the winning bid is passed back into the publisher's ad server to trigger a price priority line item. We explain this process in more detail in The Header Bidding Process.

Prior to the introduction of Header Bidding, ad inventory had to be offered to one ad network at a time.

Why use Header Bidding?

Header Bidding provides publishers with a more efficient way to get the best bids from the demand partners that they work with. Having your ad inventory exposed to a greater number of advertisers means that auctions are more competitive which pushes up CPM rates and increases fill.

Header Bidding VS Ad Waterfalls

Traditional ad serving makes it very difficult for every demand partner to submit a bid for every ad request, leading publishers to rely on approaches such as ad waterfalls, to try to get the most from each partner.

Ad waterfalls are configured so that publishers must offer their inventory to ad networks and exchanges based on historical performance. This essentially means that publishers could be selling themselves short as it does not take into consideration the fact that the highest paying ad network may not submit the highest bid at that particular time.

Not only does ad waterfalling often result in leaving money on the table, but it can also increase page load times as it takes longer to offer impressions to one ad network at a time.

Unlike waterfalls, Header Bidding gives every participating demand partner the chance to submit a bid on every ad request, not just that are passed-back from partners “higher up the stack.” With the right mix of partners, this maximises the chance of landing a high bid.

What do publishers gain from using Header Bidding?

We see publishers benefiting from Header Bidding on three fronts:

Higher bids. By giving all partners a fair look, there is a greater chance of a higher bid.

Higher Ad Manager earnings. We traffic Header Bidding against dynamic allocation, giving Google the option to beat the winning bid each time. This forces Google Ad Manager to bid higher if it wants to win impressions.

Income security. Working efficiently with more partners means a diversified income stream and less reliance on a single partner for income.

In terms of revenue gains, results are dependent both on the quality of the Header Bidding setup and management and can also often be very site-dependent. It is very rare not to see worthwhile gains from the implementation of Header Bidding on any site with reasonable levels of traffic. If you would like a better idea of the gains it could bring to your site please get in touch.